This document provides an overview of financial services in India. It defines financial services as services required for mobilizing and channeling savings to productive activities. It discusses the key components, functions, categories and examples of financial services in India. The categories discussed include asset management companies, liability management companies, fund based financial services companies and fees based financial services companies. Examples of specific financial services discussed include leasing, factoring, bill discounting, securitization, mutual funds, merchant banking and venture capital financing. The document also lists some of the top 10 financial services companies operating in India.

1. Financial Services
(12MBAW-49)
Introduction
Financial Services
BY
SADDAM HUSSAIN

2. Unit –I (Syllabus)
• Introduction to Financial System and
Financial Markets, Instruments
• Evolution of Indian Financial System
• Financial Services: concepts, features,
constituents and types
• Regulatory Framework for Financial
Services(NBFC)
• Stock Exchanges of India; SEBI

3. Financial Services??

4. Financial Services
Services required for
mobilizing and
channelizing savings to
productive activities for
producing final goods &
services

5. Financial Services
Most significant
element of a financial
system interlinking
all other elements.

6. COMPONENTS OF INDIAN
FNANCIAL SYSTEM
Fourth
Elemen
t

7. Financial Services
Includes various
services created and
delivered by the
financial system-not
only helps raise funds
but ensure their
efficient deployment.

8. Functions of Financial
Services
• Mobilization of funds
• Effective Deployment of funds
• Provision of need based services
• Provision of regulated service
• Enhancement of Economic
Development

9. Categories of Financial
Services

10. Categories of Financial
Services
Asset
Management
Companies
e.g: Leasing Cos.,
Mutual Fund Cos,
Merchant
Bankers…
What is being
Managed??
Liability
Management
Companies
e.g. Bill
discounting
houses,
Acceptance
houses,
Factoring,

11. Categories of Financial Services….
FUND BASED
Fin. Services Co.s
•Own the fund by
directly raising it
from the market
•Lend it to those
who need them
Ownership
&
Utilization of Fund
FEES BASED
Fin. Services Co.s
•Help others raise funds
•Do not own the fund
raised
•Provide advisory
services for effective
deployment of fund

12. Categories of Financial
Services….
Fund Based services
firms raise equity, debts and
deposits and invests in securities
and lends to those who are in need
of capital
Caters to both short term and long
term need
E.g. Commercial banking, Term
lending, Bill discounting, Leasing,
Factoring, Forfaiting, Hire
purchase, VCF….

13. Categories of Financial
Services….
Fees-Based Services
Enables the corporate sector &
others to raise capital from the
market or exchange financial
assets & risks with other
participants of the
market..against a FEES
E.g.-Merchant Banking, Stock
Broking, credit Rating, Mutual
Funds, Portfolio Mgt.
services…

14. A Glimpse of the variety
of
Financial Services

15. LEASING
Means for financing capital
equipments
Contractual agreement by
which a firm acquires the right
to use an asset for a definite
period by paying rentals

16. FACTORING
FS designed to manage the
receivables of a firm
An arrangement for obtaining
funds by selling receivables to
a specialized financing agency
(factor) .

17. BILL DISCOUNTING &
SECURITIZATION
Bill discounting is a practice
of lending against the
commercial bills of a trader.
Securitization is a process of
pooling & packaging
homogenous illiquid asset
(receivables-long term) into

18. MUTUAL FUNDS
Are financial intermediaries
that collect the savings of
small investors and invests
them in a diversified
portfolio of securities to
minimize risk and maximize
returns for investors

19. MERCHANT BANKERS
Provide specialized
services as managing new
issues, underwriting,
portfolio mgt., financial
restructuring, advisory
services for M&A…..

20. VENTURE CAPITAL
FINANCING
Provide a form of equity
financing designed
especially for funding high
risk and return projects
(new
products/inventions/innovations).

21. CREDIT RATING
A specialized form of
financial services involved
in the assessment of the
credit record, integrity, and
capability of a prospective
borrower to meet its debt
obligation.

22. Salient Features of Financial
Services
Highly Customer Oriented
Intangibility
Inseparability
Perish ability
People-based service
Dynamism

23. CONSTITUNTS OF FINANCIAL SERVICES
INSTRUMEN
TS
•Debt
•Equity
•hybrid
MARKET
PLAYERS
-Banks, FIs,
MFs, MBs,
Brokers, ….
SPECIALIZE
D
INSTITUTION
S
-Credit rating
agencies,
depositories
….
REGULATORY
BODIES
-RBI, SEBI, Dept.
of Banking &
Insurance, IRDA…..
Constituents of Financial Services

24. Financial Services Sector…
A torchbearer throwing light on the
 sources of funds
 the quantum of funds that can be
mobilized from such sources
Providing solutions to problems
faced by various components of Fin.
System
Increasingly contribute to economic
growth & development

25. List of top 10 financial services
companies in India•
SBI Capital Markets Limited:
This happens to be the oldest organizations in the sphere of capital markets in India.
Established in 1986 in the form of an ancillary of SBI, they have ranked second in
Asia's Project Advisory services. The company is a traiblazer in privatization and
securitization. The subsidiaries of SBI Capital Markets are SBICAPs Ventures Ltd.,
SBICAP Trustee Co.Ltd. and many others.
Bajaj Capital Limited:
One of the major financial services companies in India, Bajaj Capital offers best
investment advisory and financial planning services. The services are meted out to
the institutional investors, NRIs, corporate houses, individual investors, high network
clients as well.
DSP Merrill Lynch Limited:
A major player in the equity and debt market in India, DSP Merrill Lynch offers
financial advises to varied corporations and institutions. With an array of wealth
management and investor services, their services are customized in a manner that
they meet every investor requirement.
Birla Global Finance Limited:
The subsidiary of Aditya Birla Nuvo Ltd., this company has operations in the
corporate finance and capital market arena. An alliance with Sun Life Financial of
Canada, they have given birth to Birla Sun Life Insurance Co Ltd., Birla Sun Life
Distribution Co. and alike.
Housing Development Finance Corporation:
A best financial solution for home loans, NRI loans, HDFC is the one stop destination

26. List of top 10 financial services
companies in India
PNB Housing Finance Limited:
This company offers premium solutions for relieving the borrower segment. The
Home Loan Life Insurance Plan of this has come in conjunction with TATA AIG,
with the lowest premium when compared to the peers.
ICICI Group:
Wide arena of financial products and services, ICICI Group has solutions like
InstaBanking, Online Trading, Insta Insure, ICICI Bank imobile etc. Providing
high class financial services in all segments of the society, ICICI Group deals
with Mutual Fund, Private Equity, Securities, and Life Insurance etc.
LIC Finance Limited:
It is the biggest Housing Finance Company in India, providing finance to
individuals for repair or construction or renovation of any old or new apartment
or house.
L & T Finance Limited:
Established in 1994 by the Larsen and Turbo group, this has become a
significant name in the financial sector. Funds for automobiles, Agricultural
Instruments, secured loans; they have all types of loans for a long tenure.
Karvy Group:
With Mutual Funds Services, Depository Services, Debt Market Services,
Investment Banking and many others, Karvy Group has spanned across the
domestic financial sector as well as abroad.